Prosecutors probe Eni CEO contact with Algeria bribe "fixer"

February 08, 2013|Reuters

By Stephen Jewkes and Manuela D'Alessandro

MILAN, Feb 8 (Reuters) - A warrant to search the premises ofEni chief executive Paolo Scaroni was based on ameeting he had with the man alleged to have distributed bribesto win Algerian gas contracts for group company Saipem.

State-controlled Eni is the biggest listed Italian companyand the leading foreign energy operator in Algeria, where Italysources 30 percent of its gas, making the North African countryvital to its energy security.

According to the Milan prosecutors, bribes to win contractsassigned by Algeria's state-owned energy giant Sonatrach werepaid by companies of the Saipem group to a company called PearlPartners Limited, based in Hong Kong, of which Bedjaoui, aFrench national born in Algeria, was a beneficiary.

The prosecutors said Scaroni, together with Eni North Africachief Antonio Vella, had on one occasion met Bedjaoui and theformer Algerian energy minister Chekib Khelil at a Paris hotel.

"The meeting was aimed at obtaining a further order ... toincrease profitability at the Menzel Ledjemet Est (MLE) field,"the search warrant said.

Scaroni, who pleaded guilty in the 1990s to bribery chargesas part of the Tangentopoli scandal that brought down Italy'spost-war political parties, could not be reached for comment,but said in Italian daily La Repubblica on Friday that he hadmet Bedjaoui only briefly.

"What fixer? The person mentioned in the prosecutors'document I met just once in my life and only for a few minutes,"Scaroni was quoted as saying.

"He was introduced to me as the special secretary of theAlgerian energy minister: he accompanied me, and I never saw himagain."

Eni declined further comment on Friday, but said on Thursdaythat though Scaroni was being investigated, "Eni and its CEOdeclare themselves totally unrelated to the object of theinvestigation".

Khelil could not immediately be reached for comment.

In December former long-standing Saipem CEO Pietro FrancoTali and Eni CFO Alessandro Bernini resigned after Milanprosecutors opened an investigation into alleged corruption inAlgeria.

Saipem said then that Tali had not been targeted by theprobe but resigned to allow the group to better respond to theinvestigations. Eni said at the time, "While Alessandro Berniniconsiders that his actions were right and proper it is his viewthat Eni's interests are better served by his resignation".

GAS ASSETS

Eni shares fell 4.6 percent on Thursday, though they were upabout 0.5 percent on Friday.

Saipem offices and the offices of two other current and pastsenior executives were also searched.

Eni has operated in Algeria since 1981 and has considerablegas assets there that are crucial to Italy, which has little oiland gas production of its own and no nuclear power.

Eni owns 43 percent of Saipem and has said that by law itcannot have any say in its day-to-day business.

Bedjaoiu, a relative of a former Algerian foreign secretary,had numerous contacts with Sonatrach, the prosecutors said.

In the search warrant, prosecutors also said former Eni CFOBernini and another Saipem executive maintained relations withPearl Partners in Hong Kong. It was not immediately possible toreach Bernini for a comment, and Reuters was unable to find anycontacts for Pear Partners.